It is strange, because it all seems to be unfolding in slow motion. Someone on this board (Cladking?) pointed out long ago that as things crash and burn, there is always time to cash out and survive more or less intact, but few actually take action. It all comes crashing down so slowly, it is hard to believe it is really happening.
Where the hell did he come up with this month-over-month inflation rate? Even the fourtenths jump from June to July doesn't support his inflation numbers.
Once again EbayTrader shoots from the hip without scrutinizing the data in front of him. The author's facts and figures as presented are accurate. His case his well brought out and defended. Yet EBT can find 2 miniscule "contradictions" to reject what is to me a very valid argument. The CPI numbers did in fact take a prompt jump upwards from June to July of 1933 (ie one month) just as the author said. In fact if you ratio the 13.1 and 12.7 figures from June to July and annualize it by multiplying by 12, you in fact come out with something fairly close to the 40% stated by the author (in my case I came up with approx 38%). More than likely the author found source data that was taken to more than a single decimal place. A ratio of 13.14/12.66 could have gotten the 45% rate on the author's chart. This is math that a 5th grader can do. If one simply looks at the graphics, the prompt increase in mid-1933 would indicate a very large monthly change....almost vertical...and would bear further inspection before dismissing the author's claim.
As far as the chart not going out to 1938, it seems meaningless as the author defended and proved his points....ie. inflation turned right around in 1933 right after removal of the gold standard and a 40% dollar devaluation. For what it's worth there are no numbers in 1938 in the 13.8 as EBT states. From mid 1937 to mid 1939 there is a 5% deflation as the rate drops from 14.5 to 13.8...over a 2 year period. That's 2.5% per year. Considering how far the index fell in the few years prior to 1933 this is a non-event. Yes, there was a 2nd recession from 1937-1939, but not on the order of 1930-1933. The author didn't include it because it had no bearing.
Ebaytrader was correct on one thing, the CPI data is readily obtained. Good analysis.
Where the hell did he come up with this month-over-month inflation rate? Even the fourtenths jump from June to July doesn't support his inflation numbers.
Once again EbayTrader shoots from the hip without scrutinizing the data in front of him. The author's facts and figures as presented are accurate. His case his well brought out and defended. Yet EBT can find 2 miniscule "contradictions" to reject what is to me a very valid argument. The CPI numbers did in fact take a prompt jump upwards from June to July of 1933 (ie one month) just as the author said. In fact if you ratio the 13.1 and 12.7 figures from June to July and annualize it by multiplying by 12, you in fact come out with something fairly close to the 40% stated by the author (in my case I came up with approx 38%). More than likely the author found source data that was taken to more than a single decimal place. A ratio of 13.14/12.66 could have gotten the 45% rate on the author's chart. This is math that a 5th grader can do. If one simply looks at the graphics, the prompt increase in mid-1933 would indicate a very large monthly change....almost vertical...and would bear further inspection before dismissing the author's claim.
As far as the chart not going out to 1938, it seems meaningless as the author defended and proved his points....ie. inflation turned right around in 1933 right after removal of the gold standard and a 40% dollar devaluation. For what it's worth there are no numbers in 1938 in the 13.8 as EBT states. From mid 1937 to mid 1939 there is a 5% deflation as the rate drops from 14.5 to 13.8...over a 2 year period. That's 2.5% per year. Considering how far the index fell in the few years prior to 1933 this is a non-event. Yes, there was a 2nd recession from 1937-1939, but not on the order of 1930-1933. The author didn't include it because it had no bearing.
Ebaytrader was correct on one thing, the CPI data is readily obtained. Good analysis.
roadrunner >>
Gosh darn it!
Forgot to mention that the currency in circulation (M-0) fell from 1933 to 1934. Kinda shoots a hole in his theory, doesn't it?
1. (13.1/12/7) x 12 = ??? hint, it ain't "fourtenths" (sic). I wouldn't even dare try to present compounding a monthly rate because that's the realm of 7th graders.
2. M0 is not the only factor in the money supply, you'll have to do better than that. There's not a analyst worth his salt today who would call total money supply M0. Also, what did the stock market do following this? Why did consumer prices go up for 3-4 years straight?
Rather than trolling for potential customers, it appears all the author got for his effors was a troll.
2. M0 is not the only factor in the money supply, you'll have to do better than that. There's not a analyst worth his salt today who would call total money supply M0. Also, what did the stock market do following this? Why did consumer prices go up for 3-4 years straight?
roadrunner >>
Your intellectual dishonesty (the hallmark of liberals) is getting the best of you. Did you read that stoopid article? Since inflation is a monetary phenomena, if you don't increase M-0 you can't have inflation. So, since you support that boob's conclusions, enlighten all of us uneducated and unwashed masses as to why the economy began to recover and then faltered again in 1938-9. Hint: it ain't because of the Fed pumping the $ out.
Unfortunately, I'm afraid this is not hyperbole. Even though the effect could be severely deflationary, in the short term, you'd have to expect a major upward more for gold. Presumably downward pressure on the euro, perhaps a move back towards dollars. In any case, we probably won't need to wait long to find out. I hope there are some cool heads out there.
>>
That makes two of us.
I can't shake the feeling that this whole thing was caused by government intervention in the commodity markets and continuing intervention is pre- venting rising prices.
The markets were just showing a natural increase to the growing monetary stimulants; growing government spending. There was some concern with the viability of debt instruments both public and private. These increases appeared inflationary and in trying to prick the balloon they exascerbated the problem with debt causing everything to implode.
Now, instead of returning us to where we were headed they are hell bound to return us where we were. This isn't Kansas anymore. We can't go back because there wasn't enough oil or electricity or anything else. But they still seem to be trying and causingf more problems and more political instability as region after region suffer from dislocations in demand and pricing.
What many don't realize is that farms no longer use rain and sunlight to turn hard work into food. Farms now days are larger immobile chemical plants that turn capital and debt into fodder for factories which spit out the raw material for big macs. When the capital dries up or something goes wrong with the chain of factories there will be increasingly less material to feed people.
The government should have a plan A that involves inflating the economy back to where we were but with a new way of doing things and realistic goals for the near and long term. This should involve telling the public the truth that inflation is coming and they will do everything possible to keep it in check. They also need a plan B which moves assets and infrastructure into the hands of those who can operate it. We can't allow major infrastruc- ture to sit idle even briefly if there's a panic which destroys the financial sys- tem.
All we hear is political bickering and no one has stepped forward to lead.
This seems to apply everywhere. So long as things are still operating the biggest thing to fear really is fear. We need leadership now. The issues are complex but we can start on a path before we fully know the destina- tion. Ultimately we never know where we're going until we gwet there anyway so let's get off the damn dime.
Yes and many millions of ignorant Americans are CELEBRATING this fact.
Personally I hope they all drown in their own crap. >>
It was pretty obvious in 1990 that we had lost the cold war. The Soviet economy collapsed but their ideology reigned supreme. Now our economy is in some danger but the ideology is nearly as strong as ever.
<< Newsweek cover, "We Are All Socialists Now"....
Like Al said, the debate is over.
Comrade Renski >>
So the tide has turned and soon we will long for the good old days when Wall Streeters ate at Mortons while the rest of us watched our pensions get stolen. I'm no fan of Socialism but how they used good old "Capitalism" to rob us blind makes me want to puke. (Where are the trials and executions?, bring back the guillotine)
I would hope the "Socialists" would at least have the good sense to take away this "fractional reserve banking" system that has allowed the rich to control the masses for so long. "He who prints the money controls the country" and has been going on too long. My best guess is that we will end up with a homogenous system that in the end will still leave the elite on top and the rest of us paying a little more to support the lower classes.
I have no faith in either system. God, gold and guns is where my faith lies.
BTW Ive never seen gold take off so much this early in the evening. Up over 16 bucks now, must be some real fireworks gonna happen in the AM.
<< <i><< Newsweek cover, "We Are All Socialists Now"....
Like Al said, the debate is over.
Comrade Renski >>
So the tide has turned and soon we will long for the good old days when Wall Streeters ate at Mortons while the rest of us watched our pensions get stolen. I'm no fan of Socialism but how they used good old "Capitalism" to rob us blind makes me want to puke. (Where are the trials and executions?, bring back the guillotine)
I would hope the "Socialists" would at least have the good sense to take away this "fractional reserve banking" system that has allowed the rich to control the masses for so long. "He who prints the money controls the country" and has been going on too long. My best guess is that we will end up with a homogenous system that in the end will still leave the elite on top and the rest of us paying a little more to support the lower classes.
"Socialist" don't have good sense and the capitalism you speak of is not Capitalism. The real free market version has died a long time ago. The classic technique of Socialism is the slow drip and incrementalism into every facet of our lives until one day we wake up and realize the big FEDERAL government has robbed all of our rights. The states are beholden and the sheeple are medicated. Soylent green is people! ( )
I would hope the "Socialists" would at least have the good sense to take away this "fractional reserve banking" system that has allowed the rich to control the masses for so long. "He who prints the money controls the country" and has been going on too long. My best guess is that we will end up with a homogenous system that in the end will still leave the elite on top and the rest of us paying a little more to support the lower classes.
I have no faith in either system. God, gold and guns is where my faith lies.
comrade coynclecterski make good point. what you get when big nanny and big brother make society? hah! jmski have nightmare.
Q: Are You Printing Money? Bernanke: Not Literally
"My best guess is that we will end up with a homogenous system that in the end will still leave the elite on top and the rest of us paying a little more to support the lower classes"
There is some rather remarkable research that shows quite convincingly that no matter what the system (Soviet Russia, Socialist Sweden, Nazi Germany, Capitalist HK, Relatively Free Market US, Wacko North Korea ...), a rather small percentage of the population controls a large proportion of the wealth. The aggregate wealth changes, but the distributions remain surprisingly similar.
<< <i>"My best guess is that we will end up with a homogenous system that in the end will still leave the elite on top and the rest of us paying a little more to support the lower classes"
There is some rather remarkable research that shows quite convincingly that no matter what the system (Soviet Russia, Socialist Sweden, Nazi Germany, Capitalist HK, Relatively Free Market US, Wacko North Korea ...), a rather small percentage of the population controls a large proportion of the wealth. The aggregate wealth changes, but the distributions remain surprisingly similar. >>
It doesn't take a rocket scientist to realize that. It's been like that since the beginning of recorded times & will continue until the end of time. And to think, some one actually got paid for coming up with that answer....
"Bongo drive 1984 Lincoln that looks like old coin dug from ground."
"It doesn't take a rocket scientist to realize that"
Actually, it is probably more sophisticated than rocket science, which is for the most part mundane. The general study of why some cultures and societies prosper and other don't is far from trivial, and far from intuitive.
Human nature (greed) will always factor into the problems we are facing today and the future ones also. When the system corrects and stabilizes it will almost faulter in the future because of this. Greesnspan spoke of this on CNBC's House of Cards Program.
California is firing 20,000 state workers (mostly through attrition) and states are liable for over 1 trillion in health benefits owed to state retirees. The tsunami has begun and is building momentum.
Where's the deflation?? Let's see... 0.8% per month is close to 10% per year. And what happens when oil starts swinging back over the next few months just in time to help gasoline get to $3+ again this summer? I think someone better tell wholesale energy prices to start acting deflationary! Feb oil and gas dropped so maybe that will help out for next months figures, but gasoline is only going up it seems.
Inflation at the wholesale level surged unexpectedly in January, reflecting sharply higher prices for gasoline and other energy products.
The Labor Department said Thursday that wholesale prices increased by 0.8 percent last month, the biggest gain since last July and well above the 0.2 percent increase that economists had expected.
The acceleration was led by a 3.7 percent surge in energy prices with gasoline prices jumping by 15 percent, the biggest gain in 14 months.
Even outside the volatile food and energy sectors, wholesale prices showed a bigger-than-expected increase, rising by 0.4 percent. Economists had expected a slight 0.1 percent rise in so-called core inflation.
Food prices were well-behaved last month, falling for a second straight month. The 0.4 percent decline in January reflected lower costs for beef and dairy products which offset gains in the price of vegetables and chicken products.
In addition to the big jump in gasoline costs, prices for home heating oil were up by 5.4 percent and liquefied petroleum gas, which is often used to heat homes in rural areas, surged by 20.2 percent, the biggest jump in more than six years.
Outside of food and energy, there were increases for pharmaceuticals, light trucks and passenger cars and civilian aircraft.
Despite the big jump in wholesale prices in January, economists do not believe inflation is on the verge of becoming a problem, given the country's deep recession. ....so when have govt economists been right on a published economic forecast?
Some consolidation here may not be such a bad thing. The US needs to start getting it's economy back to the making/providing phase, instead of consumer spending as most of the GDP to really fix the deep rooted problems here.
Funny thing is, JC Penney is openning the biggest store in the state as a stand alone store down the street in a couple weeks.
Some consolidation here may not be such a bad thing. The US needs to start getting it's economy back to the making/providing phase, instead of consumer spending as most of the GDP to really fix the deep rooted problems here.
Funny thing is, JC Penney is openning the biggest store in the state as a stand alone store down the street in a couple weeks. >>
What needs to be "consolidated" and reduced is the government in all forms. Not private enterprise.
A long but interesting read by JW who never pulls any punches. He basically expects barter systems to begin flourishing among the major eastern nations (Russia, China, Germany, India, SA) to get around the current US-UK price fixing schemes. The recent agreement between Russia and China for the Chinese to purchase $25 BILLION in oil over 20 years is an early example. The current discrepancy between Brent and WTI oil is good example of price fixing and/or manipulation....as was the rise to $147 and the crash back to about $30. A key part in this manipulations are the opaque derivatives schemes that work with "play" money. Basically JW's assessment of Davos was a "we aren't gonna take it anymore" love fest. The fact that ten TRILLION dollars of US borrowing is already lined up to be spent as well as budget deficits of TRILLIONs for years to come is not giving the eastern nations a warm feeling.
Willie sees this power shift happening relatively soon. He expects a new competing/bartering currency from that group in 2010.
Umm ... the ruler of a near bankrupt police state hardly has a credible role in defining a new world order.
Also, the only scenario in which US prosperity falls to that of a third world nation is utter global chaos, and even in that situation, the US will be better off than most. In fact, barring nuclear war, even in a situation of global chaos, the US will remain basically stable, though clearly of much diminished wealth.
<< <i>"... the only scenario in which US prosperity falls to that of a third world nation is utter global chaos, and even in that situation, the US will be better off than most. In fact, barring nuclear war, even in a situation of global chaos, the US will remain basically stable, though clearly of much diminished wealth. >>
I would not be so sure about that. A disruption in the supply lines in the US caused by bankrupt shippers(high fuel)/farmers(high real estate tax)/retailers (no consumer cash for goods) could cause critical shortages and mass civil unrest in the urban centers. Think Katrina, but affecting most US cities. Kick enough 18-35 yr olds out of their houses and you will also have some angry able bodied males around.
I assure you it is possible. Only fools believe the USA is somehow immune to human nature.
Mark Piersall Random Collector www.marksmedals.com
(regarding the ridiculous "third world" statement) -- there is zero probability that per capita GDP in the US will fall to the level of Russia, much less China.
The US will be almost certainly be better off than other industrialized countries, ie, Europeans, Japanese, Korean. In the "Katrina" situation you refer to, these countries will be harder hit than we are.
Strictly speaking I do not disagree with you. However.... We are masters of massaging GDP numbers to be whatever we want. I am not sure GDP number comparisons are relevant.
I think the 'third world' comments were not meant in a strict meaning, but rather in perception. The things we are doing and will do if things actually get bad are like what we see in central America, Indonesia. etc. NOT in a world economic leader. Will our economy still be 'larger' than in France?...sure. But if I look out my window and see a riot, I am not sure it matters.
Mark Piersall Random Collector www.marksmedals.com
He denounces Obammunism and its latest policy of subsidizing deadbeats and parasites at the expense of the productive. The other CNBC talking heads are confused, befuddled, and clueless, as usual.
<< <i>latest policy of subsidizing deadbeats and parasites at the expense of the productive >>
Most of the people who are in danger of losing their homes worked hard all of their lives and have been a lot more productive for society than those who have made a living sitting on their fat behinds selling old coins to wealthy hobbyists.
<< <i>latest policy of subsidizing deadbeats and parasites at the expense of the productive >>
Most of the people who are in danger of losing their homes worked hard all of their lives and have been a lot more productive for society than those who have made a living sitting on their fat behinds selling old coins to wealthy hobbyists.
CG >>
So then why don't you go and hand them out as much of your income as you can? Why would you think that dipping into my pockets and the pockets of everyone else is ok, or moral?
Most of the people who are in danger of losing their homes worked hard all of their lives and have been a lot more productive for society than those who have made a living sitting on their fat behinds selling old coins to wealthy hobbyists.
edited to avoid saying something that we'll all regret
Q: Are You Printing Money? Bernanke: Not Literally
In the next 3 months I do not foresee any good news out of any financial reporting arenas. Come about April 1st, we might be starting to see Pension Funds start to report how underfunded they are. This will lead the markets to further spiral.
I think that the current Administration is not prepared to deal with this scenario.
April 30, 2009.........Gold at $1300 and the S & P well under 700--approaching 650. I just do not see a correction in this trend anytime soon.
California just guaranteed a prolonged recession with this ?budget? solution.
One way to help fund the stimulus and mortgage bailout programs, and to reduce the Federal deficit generally, would be (a) a Federal sales tax on unproductive assets that divert capital from investment in businesses, business assets, farming assets, commercial/ residential/ productive agricultural real estate, mining, oil & gas extraction and the like, and securities issued by Federal, state, and local governments or agencies, and (b) a supplemental income tax on all income earned from the sale of unproductive assets described in (a). This would take a bit of categorization, which could be done through Treasury regulations.
Putin did or does have a decent rainy day fund from oil when it was over $100?
The US didn't do so bad either. During last summer we swapped millions of barrels of WTI sweet for Brent crude in order to flood the market with supply while not showing any decreases in the reserves...and making lots of $$ in the meantime. Now that the price is crushed (along with Russia, Saudi Arabia, Venezuela, etc.) the US is replenishing/swapping back the missing WTI at bargain prices. Once things are full up again, it will be time to let the price of WTI loose on the world. Obviously our oil trading partners are not big fans of this game. This was a terrific 1-2 punch coupled with squashing gold in July and September by increasing the 2-3 major bank short position by a factor of 6x. It was great coordination by Hanky Panky.
$1000 gold taken out today. One would have thought there'd be at least a thread topic on this? Maybe it's over on the Coin Forum (lol). All those naysayers that basically said $1000 was an impossibility in 2009, esp with deflation going on. After all, gold does not respond to deflation, only hyper-inflation. Well, so much for that myth.
Ok, now that we're technically out of the $700-$990 trading range what next? Even though this current run up produced 40% gains in the price of gold how many are now ready to step up at $1050 and commit their own money to the gold bull? And does that even make sense. Of course no discussion about the next step would be complete w/o mentioning Kitco's Senior Anal-ist John Nadler on when he now expects the next $650 gold to occur so he can once and for all get his "peeps" back on the train?
To those that slammed Jim Sinclair in 2008, his roadmap predicted as far back as 2002 the very events we see occuring today. His calls for gold's reaction have been essentially spot-on. Even though the mid-2008 hammering of gold turned the short term picture bleak, he's back right in the saddle again leading the pack. From "this is it," to "it is now," to "it is out of control," your watchman Jim has shown you the bankster's blueprint. I don't even want to know what the 4th "it" saying is going to be. Possibly something like "it's in your backyard."
<< <i>Once the middle class has been destroyed you are a third world!!! Have we been destroyed yet!!!! >>
Not yet.
Before it does it will roar with protests.
A fight is coming.
Unfortunately, the liberal media will paint it as a racial war.
They are too predictable...just look at Katrina.
Comrade Renski >>
It is going to take some ingenuity for each of us to come through the other side - the government really needs to let the bleeding happen where is should be happening and not redirecting the pain to where it shouldn't be. Of course, neither party has shown the gumption to do that yet.
<< <i>Once the middle class has been destroyed you are a third world!!! Have we been destroyed yet!!!! >>
A few more taxes that the scumbags invent, along with just a little more dumbing down so that even more people equate socialism with "fairness" and there won't be a middle class.
It sure looks there are elected shills, financed by certain interests, who see the opportunity for the following to happen, and who are trying as best they can to road block every effort to prevent these things from happening:
A. Allow the credit markets to collapse B. Sit back and watch unemployment rise C. Allow unemployment benefits to expire D. Watch wages fall E. Allow pensions and retirement savings to evaporate F. Cut funding to public education G. Castigate the educated, and lionize the ignorant H. Maintain funding for military expenditures and new weapons systems I. Maintain control over energy and other natural resources J. Lower taxes for the wealthiest 1% of the people
Given a time frame, I believe things will be much worse come mid summer....the heat will only fuel the fire! Never in my lifetim>e would i have dreamed of times like these...I am a baby boomer born from the Greatest Generation......If there is civil unrest it will not be easy to control...I saw tonight a Black man who is hell bent on finding flaws in Obama's citizenship and his true intent as the leader of this once great nation....When the unemployment checks begin to stop and there is no food or money to pay the rent...there is going to be Hell to pay!!!!! I don't know how they think $400 is going to help anyone...they should put that money into putting people to work or building homelesss shelters fot those who need help! Because $400 is not going to help anyone.
Bloom tries to explain the current disconnect from the gold shares (XAU/HUI) from the bullion price. While gold has been scurrying upwards from the mid-800's since January the gold shares have fallen way behind while mapping out a rising wedge formation. Normally this type of action precedes a fall in the stocks followed by bullion. The author gives a possible reason why the current situation could resolve counter to the norm.
One thing I don't understand with Bloom's analysis are the weekly gaps he says were created in 2009 at $850 and $960 gold. In reviewing the daily and weekly gold charts back to November, I can't find any gaps at all in both the daily and weekly gold prices. Can't even find gaps in the XAU. Everything is perfectly overlapped. That made me wonder how macro do you have to go to ensure gaps don't exist?....daily, weekly, monthly, etc. Isn't it perfectly reasonable to have a continuous day to day chart that advances $100 that week, while the weekly chart shows that as a gap-up? This would assume the following weeks continue upwards as well each day.
Comments
It is strange, because it all seems to be unfolding in slow motion. Someone on this board (Cladking?) pointed out long ago that as things crash and burn, there is always time to cash out and survive more or less intact, but few actually take action. It all comes crashing down so slowly, it is hard to believe it is really happening.
1933-04-01 12.60
1933-05-01 12.60
1933-06-01 12.70
1933-07-01 13.10
1933-08-01 13.200
1933-09-01 13.200
1933-10-01 13.200
Where the hell did he come up with this month-over-month inflation rate? Even the fourtenths jump from June to July doesn't support his inflation numbers.
Once again EbayTrader shoots from the hip without scrutinizing the data in front of him. The author's facts and figures as presented are accurate. His case his well brought out and defended. Yet EBT can find 2 miniscule "contradictions" to reject what is to me a very valid argument. The CPI numbers did in fact take a prompt jump upwards from June to July of 1933 (ie one month) just as the author said. In fact if you ratio the 13.1 and 12.7 figures from June to July and annualize it by multiplying by 12, you in fact come out with something fairly close to the 40% stated by the author (in my case I came up with approx 38%). More than likely the author found source data that was taken to more than a single decimal place. A ratio of 13.14/12.66 could have gotten the 45% rate on the author's chart. This is math that a 5th grader can do. If one simply looks at the graphics, the prompt increase in mid-1933 would indicate a very large monthly change....almost vertical...and would bear further inspection before dismissing the author's claim.
As far as the chart not going out to 1938, it seems meaningless as the author defended and proved his points....ie. inflation turned right around in 1933 right after removal of the gold standard and a 40% dollar devaluation. For what it's worth there are no numbers in 1938 in the 13.8 as EBT states. From mid 1937 to mid 1939 there is a 5% deflation as the rate drops from 14.5 to 13.8...over a 2 year period. That's 2.5% per year. Considering how far the index fell in the few years prior to 1933 this is a non-event. Yes, there was a 2nd recession from 1937-1939, but not on the order of 1930-1933. The author didn't include it because it had no bearing.
Ebaytrader was correct on one thing, the CPI data is readily obtained. Good analysis.
roadrunner
<< <i>"the Chinese say "no mas""...nope, the Chinese will say "bu hen hao" (not good) 'cause they don't speak spanish.
They don't?
Si se puede!
<< <i>1933-03-01 12.60
1933-04-01 12.60
1933-05-01 12.60
1933-06-01 12.70
1933-07-01 13.10
1933-08-01 13.200
1933-09-01 13.200
1933-10-01 13.200
Where the hell did he come up with this month-over-month inflation rate? Even the fourtenths jump from June to July doesn't support his inflation numbers.
Once again EbayTrader shoots from the hip without scrutinizing the data in front of him. The author's facts and figures as presented are accurate. His case his well brought out and defended. Yet EBT can find 2 miniscule "contradictions" to reject what is to me a very valid argument. The CPI numbers did in fact take a prompt jump upwards from June to July of 1933 (ie one month) just as the author said. In fact if you ratio the 13.1 and 12.7 figures from June to July and annualize it by multiplying by 12, you in fact come out with something fairly close to the 40% stated by the author (in my case I came up with approx 38%). More than likely the author found source data that was taken to more than a single decimal place. A ratio of 13.14/12.66 could have gotten the 45% rate on the author's chart. This is math that a 5th grader can do. If one simply looks at the graphics, the prompt increase in mid-1933 would indicate a very large monthly change....almost vertical...and would bear further inspection before dismissing the author's claim.
As far as the chart not going out to 1938, it seems meaningless as the author defended and proved his points....ie. inflation turned right around in 1933 right after removal of the gold standard and a 40% dollar devaluation. For what it's worth there are no numbers in 1938 in the 13.8 as EBT states. From mid 1937 to mid 1939 there is a 5% deflation as the rate drops from 14.5 to 13.8...over a 2 year period. That's 2.5% per year. Considering how far the index fell in the few years prior to 1933 this is a non-event. Yes, there was a 2nd recession from 1937-1939, but not on the order of 1930-1933. The author didn't include it because it had no bearing.
Ebaytrader was correct on one thing, the CPI data is readily obtained. Good analysis.
roadrunner >>
Gosh darn it!
Forgot to mention that the currency in circulation (M-0) fell from 1933 to 1934. Kinda shoots a hole in his theory, doesn't it?
1. (13.1/12/7) x 12 = ??? hint, it ain't "fourtenths" (sic). I wouldn't even dare try to present compounding a monthly rate because that's the realm of 7th graders.
2. M0 is not the only factor in the money supply, you'll have to do better than that. There's not a analyst worth his salt today who would call total money supply M0. Also, what did the stock market do following this? Why did consumer prices go up for 3-4 years straight?
Rather than trolling for potential customers, it appears all the author got for his effors was a troll.
roadrunner
UAW, etc
<< <i>
2. M0 is not the only factor in the money supply, you'll have to do better than that. There's not a analyst worth his salt today who would call total money supply M0. Also, what did the stock market do following this? Why did consumer prices go up for 3-4 years straight?
roadrunner >>
Your intellectual dishonesty (the hallmark of liberals) is getting the best of you. Did you read that stoopid article? Since inflation is a monetary phenomena, if you don't increase M-0 you can't have inflation. So, since you support that boob's conclusions, enlighten all of us uneducated and unwashed masses as to why the economy began to recover and then faltered again in 1938-9. Hint: it ain't because of the Fed pumping the $ out.
<< <i>Newsweek cover, "We Are All Socialists Now"....
Like Al said, the debate is over.
Comrade Renski >>
Yes and many millions of ignorant Americans are CELEBRATING this fact.
Personally I hope they all drown in their own crap.
Coin's for sale/trade.
Tom Pilitowski
US Rare Coin Investments
800-624-1870
<< <i>Eastern Europe Financial Meltdown Imminent?
Unfortunately, I'm afraid this is not hyperbole. Even though the effect could be severely deflationary, in the short term, you'd have to expect a major upward more for gold. Presumably downward pressure on the euro, perhaps a move back towards dollars. In any case, we probably won't need to wait long to find out. I hope there are some cool heads out there.
>>
That makes two of us.
I can't shake the feeling that this whole thing was caused by government
intervention in the commodity markets and continuing intervention is pre-
venting rising prices.
The markets were just showing a natural increase to the growing monetary
stimulants; growing government spending. There was some concern with
the viability of debt instruments both public and private. These increases
appeared inflationary and in trying to prick the balloon they exascerbated
the problem with debt causing everything to implode.
Now, instead of returning us to where we were headed they are hell bound
to return us where we were. This isn't Kansas anymore. We can't go back
because there wasn't enough oil or electricity or anything else. But they still
seem to be trying and causingf more problems and more political instability
as region after region suffer from dislocations in demand and pricing.
What many don't realize is that farms no longer use rain and sunlight to turn
hard work into food. Farms now days are larger immobile chemical plants
that turn capital and debt into fodder for factories which spit out the raw
material for big macs. When the capital dries up or something goes wrong
with the chain of factories there will be increasingly less material to feed
people.
The government should have a plan A that involves inflating the economy
back to where we were but with a new way of doing things and realistic
goals for the near and long term. This should involve telling the public the
truth that inflation is coming and they will do everything possible to keep
it in check. They also need a plan B which moves assets and infrastructure
into the hands of those who can operate it. We can't allow major infrastruc-
ture to sit idle even briefly if there's a panic which destroys the financial sys-
tem.
All we hear is political bickering and no one has stepped forward to lead.
This seems to apply everywhere. So long as things are still operating the
biggest thing to fear really is fear. We need leadership now. The issues
are complex but we can start on a path before we fully know the destina-
tion. Ultimately we never know where we're going until we gwet there
anyway so let's get off the damn dime.
<< <i>
Yes and many millions of ignorant Americans are CELEBRATING this fact.
Personally I hope they all drown in their own crap. >>
It was pretty obvious in 1990 that we had lost the cold war. The Soviet
economy collapsed but their ideology reigned supreme. Now our economy
is in some danger but the ideology is nearly as strong as ever.
Like Al said, the debate is over.
Comrade Renski >>
So the tide has turned and soon we will long for the good old days when Wall Streeters ate at Mortons while the rest of us watched our pensions get stolen. I'm no fan of Socialism but how they used good old "Capitalism" to rob us blind makes me want to puke. (Where are the trials and executions?, bring back the guillotine)
I would hope the "Socialists" would at least have the good sense to take away this "fractional reserve banking" system that has allowed the rich to control the masses for so long. "He who prints the money controls the country" and has been going on too long.
My best guess is that we will end up with a homogenous system that in the end will still leave the elite on top and the rest of us paying a little more to support the lower classes.
I have no faith in either system. God, gold and guns is where my faith lies.
BTW
Ive never seen gold take off so much this early in the evening. Up over 16 bucks now, must be some real fireworks gonna happen in the AM.
<< <i><< Newsweek cover, "We Are All Socialists Now"....
Like Al said, the debate is over.
Comrade Renski >>
So the tide has turned and soon we will long for the good old days when Wall Streeters ate at Mortons while the rest of us watched our pensions get stolen. I'm no fan of Socialism but how they used good old "Capitalism" to rob us blind makes me want to puke. (Where are the trials and executions?, bring back the guillotine)
I would hope the "Socialists" would at least have the good sense to take away this "fractional reserve banking" system that has allowed the rich to control the masses for so long. "He who prints the money controls the country" and has been going on too long.
My best guess is that we will end up with a homogenous system that in the end will still leave the elite on top and the rest of us paying a little more to support the lower classes.
"Socialist" don't have good sense and the capitalism you speak of is not Capitalism. The real free market version has died a long time ago. The classic technique of Socialism is the slow drip and incrementalism into every facet of our lives until one day we wake up and realize the big FEDERAL government has robbed all of our rights. The states are beholden and the sheeple are medicated. Soylent green is people! (
Comrade Renski
My best guess is that we will end up with a homogenous system that in the end will still leave the elite on top and the rest of us paying a little more to support the lower classes.
I have no faith in either system. God, gold and guns is where my faith lies.
comrade coynclecterski make good point. what you get when big nanny and big brother make society? hah! jmski have nightmare.
I knew it would happen.
There is some rather remarkable research that shows quite convincingly that no matter what the system (Soviet Russia, Socialist Sweden, Nazi Germany, Capitalist HK, Relatively Free Market US, Wacko North Korea ...), a rather small percentage of the population controls a large proportion of the wealth. The aggregate wealth changes, but the distributions remain surprisingly similar.
<< <i>"My best guess is that we will end up with a homogenous system that in the end will still leave the elite on top and the rest of us paying a little more to support the lower classes"
There is some rather remarkable research that shows quite convincingly that no matter what the system (Soviet Russia, Socialist Sweden, Nazi Germany, Capitalist HK, Relatively Free Market US, Wacko North Korea ...), a rather small percentage of the population controls a large proportion of the wealth. The aggregate wealth changes, but the distributions remain surprisingly similar. >>
It doesn't take a rocket scientist to realize that. It's been like that since the beginning of recorded times & will continue until the end of time. And to think, some one actually got paid for coming up with that answer....
Actually, it is probably more sophisticated than rocket science, which is for the most part mundane. The general study of why some cultures and societies prosper and other don't is far from trivial, and far from intuitive.
California is firing 20,000 state workers (mostly through attrition) and states are liable for over 1 trillion in health benefits owed to state retirees. The tsunami has begun and is building momentum.
Box of 20
gurus would definitely be in order to restore a sense of
justice to the system. Of course, all assets of these people
will be returned to a fund, to recompense the poor souls that
were harmed. Seriously, these folks destroyed untold numbers
of families. Their crime was worse then a holdup where a single
person gets killed.
A man robs a banke he gets 20 years hard time. A bank robs the
people and they get rewarded with bonuses and big golden parachutes.
Camelot
Box of 20
Inflation at the wholesale level surged unexpectedly in January, reflecting sharply higher prices for gasoline and other energy products.
The Labor Department said Thursday that wholesale prices increased by 0.8 percent last month, the biggest gain since last July and well above the 0.2 percent increase that economists had expected.
The acceleration was led by a 3.7 percent surge in energy prices with gasoline prices jumping by 15 percent, the biggest gain in 14 months.
Even outside the volatile food and energy sectors, wholesale prices showed a bigger-than-expected increase, rising by 0.4 percent. Economists had expected a slight 0.1 percent rise in so-called core inflation.
Food prices were well-behaved last month, falling for a second straight month. The 0.4 percent decline in January reflected lower costs for beef and dairy products which offset gains in the price of vegetables and chicken products.
In addition to the big jump in gasoline costs, prices for home heating oil were up by 5.4 percent and liquefied petroleum gas, which is often used to heat homes in rural areas, surged by 20.2 percent, the biggest jump in more than six years.
Outside of food and energy, there were increases for pharmaceuticals, light trucks and passenger cars and civilian aircraft.
Despite the big jump in wholesale prices in January, economists do not believe inflation is on the verge of becoming a problem, given the country's deep recession. ....so when have govt economists been right on a published economic forecast?
roadrunner
Get Ready for Mass Retail Closings ( with a video too )
Get Ready for Mass Retail Closings
Coin's for sale/trade.
Tom Pilitowski
US Rare Coin Investments
800-624-1870
I think all you need to do is start with one or two and that will get the message across loud and clear.
Hang on to your cash my friends, this recession is going to take a long time to bottom.
<< <i>
<< <i>Newsweek cover, "We Are All Socialists Now"....
Like Al said, the debate is over.
Comrade Renski >>
Yes and many millions of ignorant Americans are CELEBRATING this fact.
Personally I hope they all drown in their own crap. >>
This is actually more fitting for the time being....
We Are All Fascists Now
Comrade Renski
<< <i>220,000 Stores to close??
Get Ready for Mass Retail Closings ( with a video too )
Get Ready for Mass Retail Closings >>
Some consolidation here may not be such a bad thing. The US needs to start getting it's economy back to the making/providing phase, instead of consumer spending as most of the GDP to really fix the deep rooted problems here.
Funny thing is, JC Penney is openning the biggest store in the state as a stand alone store down the street in a couple weeks.
<< <i>
<< <i>220,000 Stores to close??
Get Ready for Mass Retail Closings ( with a video too )
Get Ready for Mass Retail Closings >>
Some consolidation here may not be such a bad thing. The US needs to start getting it's economy back to the making/providing phase, instead of consumer spending as most of the GDP to really fix the deep rooted problems here.
Funny thing is, JC Penney is openning the biggest store in the state as a stand alone store down the street in a couple weeks. >>
What needs to be "consolidated" and reduced is the government in all forms. Not private enterprise.
Coin's for sale/trade.
Tom Pilitowski
US Rare Coin Investments
800-624-1870
A long but interesting read by JW who never pulls any punches. He basically expects barter systems to begin flourishing among the major eastern nations (Russia, China, Germany, India, SA) to get around the current US-UK price fixing schemes. The recent agreement between Russia and China for the Chinese to purchase $25 BILLION in oil over 20 years is an early example. The current discrepancy between Brent and WTI oil is good example of price fixing and/or manipulation....as was the rise to $147 and the crash back to about $30. A key part in this manipulations are the opaque derivatives schemes that work with "play" money. Basically JW's assessment of Davos was a "we aren't gonna take it anymore" love fest. The fact that ten TRILLION dollars of US borrowing is already lined up to be spent as well as budget deficits of TRILLIONs for years to come is not giving the eastern nations a warm feeling.
Willie sees this power shift happening relatively soon. He expects a new competing/bartering currency from that group in 2010.
roadrunner
Umm ... the ruler of a near bankrupt police state hardly has a credible role in defining a new world order.
Also, the only scenario in which US prosperity falls to that of a third world nation is utter global chaos, and even in that situation, the US will be better off than most. In fact, barring nuclear war, even in a situation of global chaos, the US will remain basically stable, though clearly of much diminished wealth.
<< <i>"... the only scenario in which US prosperity falls to that of a third world nation is utter global chaos, and even in that situation, the US will be better off than most. In fact, barring nuclear war, even in a situation of global chaos, the US will remain basically stable, though clearly of much diminished wealth. >>
I would not be so sure about that. A disruption in the supply lines in the US caused by bankrupt shippers(high fuel)/farmers(high real estate tax)/retailers (no consumer cash for goods) could cause critical shortages and mass civil unrest in the urban centers. Think Katrina, but affecting most US cities. Kick enough 18-35 yr olds out of their houses and you will also have some angry able bodied males around.
I assure you it is possible. Only fools believe the USA is somehow immune to human nature.
Random Collector
www.marksmedals.com
My various assertions would be:
(regarding the ridiculous "third world" statement) -- there is zero probability that per capita GDP in the US will fall to the level of Russia, much less China.
The US will be almost certainly be better off than other industrialized countries, ie, Europeans, Japanese, Korean. In the "Katrina" situation you refer to, these countries will be harder hit than we are.
We are masters of massaging GDP numbers to be whatever we want. I am not sure GDP number comparisons are relevant.
I think the 'third world' comments were not meant in a strict meaning, but rather in perception. The things we are doing and will do if things actually get bad are like what we see in central America, Indonesia. etc. NOT in a world economic leader. Will our economy still be 'larger' than in France?...sure. But if I look out my window and see a riot, I am not sure it matters.
Random Collector
www.marksmedals.com
Santelli's Chicago Tea Party
Coin's for sale/trade.
Tom Pilitowski
US Rare Coin Investments
800-624-1870
<< <i>latest policy of subsidizing deadbeats and parasites at the expense of the productive >>
Most of the people who are in danger of losing their homes worked hard all of their lives and have been a lot more productive for society than those who have made a living sitting on their fat behinds selling old coins to wealthy hobbyists.
CG
<< <i>
<< <i>latest policy of subsidizing deadbeats and parasites at the expense of the productive >>
Most of the people who are in danger of losing their homes worked hard all of their lives and have been a lot more productive for society than those who have made a living sitting on their fat behinds selling old coins to wealthy hobbyists.
CG >>
So then why don't you go and hand them out as much of your income as you can? Why would you think that dipping into my pockets and the pockets of everyone else is ok, or moral?
Obviously you have real issues in life.
Coin's for sale/trade.
Tom Pilitowski
US Rare Coin Investments
800-624-1870
edited to avoid saying something that we'll all regret
I knew it would happen.
What will gold look like then, $8,000.
Comrade Renski
I think that the current Administration is not prepared to deal with this scenario.
April 30, 2009.........Gold at $1300 and the S & P well under 700--approaching 650. I just do not see a correction in this trend anytime soon.
California just guaranteed a prolonged recession with this ?budget? solution.
Putin did or does have a decent rainy day fund from oil when it was over $100?
"HOSPICE FOR US$, LAUNCH FOR GOLD"
"The USDollar is essentially dead, the Davos Forum its funeral wake. It is enjoying a physical erection in the medical morgue..."
i don't know to laugh or cry.
CG
The US didn't do so bad either. During last summer we swapped millions of barrels of WTI sweet for Brent crude in order to flood the market with supply while not showing any decreases in the reserves...and making lots of $$ in the meantime. Now that the price is crushed (along with Russia, Saudi Arabia, Venezuela, etc.) the US is replenishing/swapping back the missing WTI at bargain prices. Once things are full up again, it will be time to let the price of WTI loose on the world. Obviously our oil trading partners are not big fans of this game. This was a terrific 1-2 punch coupled with squashing gold in July and September by increasing the 2-3 major bank short position by a factor of 6x. It was great coordination by Hanky Panky.
$1000 gold taken out today. One would have thought there'd be at least a thread topic on this? Maybe it's over on the Coin Forum (lol). All those naysayers that basically said $1000 was an impossibility in 2009, esp with deflation going on. After all, gold does not respond to deflation, only hyper-inflation. Well, so much for that myth.
Ok, now that we're technically out of the $700-$990 trading range what next? Even though this current run up produced 40% gains in the price of gold how many are now ready to step up at $1050 and commit their own money to the gold bull? And does that even make sense. Of course no discussion about the next step would be complete w/o mentioning Kitco's Senior Anal-ist John Nadler on when he now expects the next $650 gold to occur so he can once and for all get his "peeps" back on the train?
To those that slammed Jim Sinclair in 2008, his roadmap predicted as far back as 2002 the very events we see occuring today. His calls for gold's reaction have been essentially spot-on. Even though the mid-2008 hammering of gold turned the short term picture bleak, he's back right in the saddle again leading the pack. From "this is it," to "it is now," to "it is out of control," your watchman Jim has shown you the bankster's blueprint. I don't even want to know what the 4th "it" saying is going to be. Possibly something like "it's in your backyard."
roadrunner
<< <i>Once the middle class has been destroyed you are a third world!!! Have we been destroyed yet!!!! >>
Not yet.
Before it does it will roar with protests.
A fight is coming.
Unfortunately, the liberal media will paint it as a racial war.
They are too predictable...just look at Katrina.
Comrade Renski
<< <i>
<< <i>Once the middle class has been destroyed you are a third world!!! Have we been destroyed yet!!!! >>
Not yet.
Before it does it will roar with protests.
A fight is coming.
Unfortunately, the liberal media will paint it as a racial war.
They are too predictable...just look at Katrina.
Comrade Renski >>
It is going to take some ingenuity for each of us to come through the other side - the government really needs to let the bleeding happen where is should be happening and not redirecting the pain to where it shouldn't be. Of course, neither party has shown the gumption to do that yet.
<< <i>Once the middle class has been destroyed you are a third world!!! Have we been destroyed yet!!!! >>
A few more taxes that the scumbags invent, along with just a little more dumbing down so that even more people equate socialism with "fairness" and there won't be a middle class.
It's closer than most people think.
Coin's for sale/trade.
Tom Pilitowski
US Rare Coin Investments
800-624-1870
A. Allow the credit markets to collapse
B. Sit back and watch unemployment rise
C. Allow unemployment benefits to expire
D. Watch wages fall
E. Allow pensions and retirement savings to evaporate
F. Cut funding to public education
G. Castigate the educated, and lionize the ignorant
H. Maintain funding for military expenditures and new weapons systems
I. Maintain control over energy and other natural resources
J. Lower taxes for the wealthiest 1% of the people
CG
Rising wedges don't always correct downwards.......Brian Bloom
One thing I don't understand with Bloom's analysis are the weekly gaps he says were created in 2009 at $850 and $960 gold. In reviewing the daily and weekly gold charts back to November, I can't find any gaps at all in both the daily and weekly gold prices. Can't even find gaps in the XAU. Everything is perfectly overlapped. That made me wonder how macro do you have to go to ensure gaps don't exist?....daily, weekly, monthly, etc. Isn't it perfectly reasonable to have a continuous day to day chart that advances $100 that week, while the weekly chart shows that as a gap-up? This would assume the following weeks continue upwards as well each day.
roadrunner
GEE VLADAMIR, NOW YOU TELL US !!!!!
<< <i>Good post TTown,
GEE VLADAMIR, NOW YOU TELL US !!!!! >>
RR posted this yesterday did you guys read it?
Davos meeting